New research shows that more than 40% of people living in London are not investing for the future, due to a lack of knowledge and inexperience.
Making money work harder is crucial, both for building personal wealth and for securing the financial futures of family members. However, despite the obvious benefits, a recent survey of over 1,100 people in employment, conducted by precious metals savings app, Minted, reveals that more than half of UK residents (54%) have no investments at all. This is mostly due to a fear of the unknown. The research showed that 43% of people in London, had no investments at all.
The survey revealed a number of hesitancies around investing and saving money, based largely on understanding the options available, including precious metals, buy-to-let property, cryptocurrency stocks and shares.
For 37% of people, the main concern around property was the upfront costs involved. For cryptocurrency and stocks and shares, more than a third of people admitted that they did not have the knowledge of whether it was a worthwhile investment in the long run (36%). Three in ten people were not confident that their current savings and investment would deliver any return.
According to the research, a lack of knowledge and worries about cost are holding people back.
Hamzah Almasyabi, co-founder of Minted said, “The fact that over half of people have no savings or investments is worrying and it’s clear that for a large number of people, it’s still very much unchartered territory. There are so many options available that finding the best route that fits the bill in terms of accessibility, risk and reward, can be tricky – especially for a first-timer.”
However, the Covid-19 pandemic has had a positive effect on general attitudes towards savings and investment, in part due to factors such job uncertainty and in some cases, more being available due to lockdown restrictions. The survey results show that the pandemic has prompted over half of people in London (53%) to start saving money, and a further 42% to show more interest in investing in future.
“The pandemic has shown that our financial security is not a given and introducing another source of income, or saving, is vital. While there are a variety of options to consider, in a climate of stock market volatility and low interest rates, more unusual options, such as gold bullion could be the safest bet, particularly for first-time investors. Buying gold is simple, with no banks involved. A rise in fintech companies such as Minted, allows users to buy and sell precious metals using a smartphone, from the comfort of their home, and have it sent directly to them. With the average annual growth rate at nine percent, buying gold and precious metals is not just extremely accessible, it’s also an easy way to save for the future.
According to the research there is still more to be done to encourage a wider spectrum of people to invest and save. In particular, 60% of women have no investments, in comparison to 47% of men in the UK. This gap is clear across the country between age groups too, with 65% of over 55-year-olds having no investments, compared to more than two thirds of 16–24-year-olds (71%), that do.
This demonstrates that while it is clear there is increasing interest around investing for the younger generation, there is still some way to go to instill confidence around for both females and older generations.
Hamzah Almasyabi added, “Broadening the appeal of savings and investment across age groups and demographics is crucial. It’s no longer the case that investing in the future requires large amounts of up-front cash and there are a number of platforms, such as Minted, which offer flexibility and accessibility. Even saving a small amount per month can be hugely beneficial in future.
“When considering investment options, it falls to the individual to educate themselves on the dos and the don’ts and important considerations can get overlooked. Too many people make the mistake of wanting an immediate return on their money but investing and saving is about being patient. A lot of investments increase their value slowly over time, meaning the longer you invest your money, the better the financial gain.
“Precious metals offer stability for those who are hesitant about saving their hard-earned money. Gold in particular has intrinsic value all over the world and is one of the oldest trading currencies. Buying bullion is no longer the preserve of the super-wealthy and we’re bringing it to the masses, whether you’re saving for yourself, your children’s’ futures or simply just looking to diversify.”